Sri Lanka’s poorest households earned substantially less in real terms in early 2025 than they did in 2016, while the richest households gained by almost exactly the same margin, according to an analysis of newly released survey data published this week.

The analysis, by Dr. Pulasthi Amarasinghe, a Research Fellow at the Institute of Policy Studies of Sri Lanka, draws on the preliminary results of the Department of Census and Statistics’ Household Income and Expenditure Survey (HIES) 2025, measured against the 2016 and 2019 rounds. All real figures are expressed in 2016 prices.

The typical household went backwards

Average monthly household income rose from Rs. 62,237 in 2016 to Rs. 120,266 in early 2025 — a nominal increase of about 93%. Adjusted for inflation, that is a real gain of just 6% across nine years.

The median household — the one at the midpoint of the distribution — did worse. Real median monthly income fell 4.3%, from Rs. 43,511 to Rs. 41,623. The decline is recent rather than steady: real median income had risen 7.6% between 2016 and 2019, then gave up those gains and more, ending 11.1% below its 2019 level.

A widening gap at both ends

The averages conceal sharply different trajectories.

The divergence is concentrated after 2019. Between 2019 and early 2025 — the period covering the COVID-19 pandemic and the economic crisis — real income among the poorest fifth fell roughly 19.6%, while the richest fifth gained about 6.8%.

As a result, the ratio between average incomes in the top and bottom quintiles widened from 10.6 times in 2016 to 11.2 in 2019 and 14.8 in early 2025. The richest fifth now earn close to 15 times what the poorest fifth earn.

Why the average no longer describes the typical household

The distance between the mean and the median has also grown. Average household income was about 43% higher than the median in 2016, a relationship that barely moved by 2019. By early 2025 the average stood nearly 59% above the median.

The mechanism is visible in the two series: between 2019 and 2025 real mean income fell only 1.7%, while real median income fell 11.1%. Gains concentrated among higher-income households can hold the national average steady even as the household in the middle loses purchasing power.

Poverty back to where it started

The poverty headcount follows the same shape. It fell from 16% in 2016 to 14.3% in 2019, then returned to 16% in the preliminary 2025 estimate — erasing the earlier improvement. Because no household survey was conducted between 2019 and 2025, the published series cannot show what happened in between; the analysis notes that World Bank revised estimates suggest poverty may have peaked near 20% during that gap.

This desk reported the 16% preliminary poverty figure on 7 November; the income-distribution findings above are the first detailed read of the same release.

Not yet established

The analysis stops short of declaring inequality worse on a comprehensive measure. The income Gini coefficient stood at 0.45 in 2016 and 0.46 in 2019; no 2025 Gini is yet available. The full HIES 2025 results — previously reported as due in December — will be needed to establish whether that broader measure has moved. The widening mean–median gap and the rising quintile ratio point in one direction, but are not substitutes for it.

A note on sourcing

Both filings cited here report the same underlying document — Dr. Amarasinghe’s analysis of the DCS data — rather than independent examinations of the survey. EconomyNext carried the analysis itself; Daily Mirror reported on it. The figures are therefore consistent between them by construction, not by corroboration.

The findings land the day before the 2027 Budget is presented to Parliament.